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Bring structure and clarity to executive compensation decisions
that often go overlooked.
Qualified plans like 401(k)s are a helpful foundation—but they often fall short for high-earning employees and executives who max out contributions quickly or face unique planning needs. That’s where non-qualified deferred compensation (NQDC) plans come in.
At Feliciano Financial, we help employers and leadership teams understand the structure, trade-offs, and long-term impact of these flexible planning tools—so decisions aren’t made in a vacuum or based on tax myths.
An NQDC plan allows select employees to defer a portion of their income beyond the limits of qualified retirement plans. The deferred compensation is often paid later—typically at retirement, termination, or a specified future date.
Unlike qualified plans, NQDCs:
– Don’t follow ERISA non-discrimination rules (you can limit participation)
– Have no IRS-mandated contribution limits
– Are subject to complex tax and timing rules under IRC Section 409A
– Are typically unfunded and backed only by the employer’s promise to pay
Qualified plans have contribution ceilings that often leave top earners with a savings shortfall relative to their retirement goals. NQDC plans can help close that gap—but only when structured carefully.
Without a clear understanding of timing, vesting, and tax implications, an NQDC plan can create unintended consequences for both the employer and the participant.
That’s the Trust Gap: when important financial commitments are made without the full context they deserve.
– Retain and reward executives with future income streams
– Customize vesting or performance-based incentives
– Provide supplemental retirement strategies when qualified plans aren’t enough
– Structure tax-deferred incentives in a way that supports long-term planning
– 409A Compliance: Plans must meet strict timing and documentation rules
– Liquidity Risk: Employers must plan ahead for when deferred comp is paid
– Participant Communication: Lack of clarity can lead to distrust or missed opportunities
– Plan Portability: Benefits are not always transferable or guaranteed in the event of a business sale or insolvency
If your executive team is relying on spreadsheets, verbal promises, or outdated plan documents—you’re not alone. Many companies intend to reward key talent, but haven’t fully clarified the structure or risks involved.
That’s where we step in—to organize your current compensation strategy, simplify the decision points, and clarify how an NQDC plan may fit into your broader goals.
Not sure if your plan is compliant, competitive, or even current?
We’re here to help you take a closer look—with structure, not sales pressure.
Schedule a Free Consultation today.
Your financial future demands a holistic approach.
Let us help you prepare for the long term-care of your loved ones.